Strategic Governance: How Corporate Oversight Drives Social Responsibility Initiatives

Abstract

Abstract:

Purpose

The aim of our study was to find how attributes of corporate governance empirically affect Corporate Social Responsibility. This study investigated the associations between CG characteristics and CSR.

Design/methodology/approach

The current study uses sample of 55 five listed non-financial companies on the Pakistan Stock Exchange(PSX), from the year 2019–2023, Quantitative method is being implemented to analyze the data. CSR spending is used to find the relationship between CG and CSR and its combined impact on firm’s performance. 

Findings

Among the important conclusions are that CSR performance is positively correlated with board size, the number of women directors, institutional ownership, and firm size. Using Return on Equity (ROE) as a proxy for profitability, the study showed that companies with strong CG mechanisms are better able to promote moral behavior, improve transparency, and maximize shareholder wealth.

Originality/Value

The study's conclusions highlight how companies with strong CG frameworks can better maintain morality and openness, which directly impacts how they handle CSR. Companies that implement strong  CG standards not only increase shareholder wealth but also show that they are committed to ethical business operations. This transparency and adherence to moral principles make it easier to incorporate CSR into their operating framework.